CONFORMED

                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


[X]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
         THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 1998

                                       OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

For the transition period _______________________ to _________________________

Commission File Number    1-12902
                          -------

                       FRONTIER ADJUSTERS OF AMERICA, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


               Arizona                                 86-0477573
    -------------------------------       ------------------------------------
    (State or other jurisdiction of       (I.R.S. Employer Identification No.)
     incorporation or organization)


                     45 East Monterey Way, Phoenix, AZ 85012
--------------------------------------------------------------------------------
                    (Address of principal executive offices)


                                 (602) 264-1061
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)


--------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                             Yes  X   No
                                                 ---     ---


Number of shares of Common Stock outstanding on   May 6  ,  1998      4,605,358
                                               -------------          ---------
<PAGE>
PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements
-----------------------------

                       FRONTIER ADJUSTERS OF AMERICA, INC.
                                AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                               March 31, 1998  June 30, 1997
                                                                               --------------  -------------
                                                                                 (unaudited)        (*)
<S>                                                                              <C>            <C>        
                                                      ASSETS
                                                      ------

CURRENT ASSETS
   Cash and cash equivalents                                                     $ 1,081,714    $ 1,012,233
   Investments                                                                     1,284,344      1,288,976
   Receivables                                                                     1,561,664      1,613,099
   Prepaid expenses                                                                  216,944        268,192
   Other                                                                             451,200        433,260
                                                                                 -----------    -----------
        TOTAL CURRENT ASSETS                                                       4,595,866      4,615,760
                                                                                 -----------    -----------

PROPERTY AND EQUIPMENT                                                             2,537,663      2,453,819
   Less accumulated depreciation and amortization                                   (776,693)      (717,593)
                                                                                 -----------    -----------
                                                                                   1,760,970      1,736,226
                                                                                 -----------    -----------

OTHER ASSETS
   Cost of subsidiary in excess of net tangible assets acquired                      213,817        213,817
   Less accumulated amortization                                                    (178,552)      (176,818)
                                                                                 -----------    -----------
                                                                                      35,265         36,999
   Receivables (Long term)                                                           431,000        431,000
   Investments (Long term)                                                           694,748        714,872
   Other                                                                             310,702        377,282
                                                                                 -----------    -----------
                                                                                   1,471,715      1,560,153
                                                                                 -----------    -----------
        TOTAL ASSETS                                                             $ 7,828,551    $ 7,912,139
                                                                                 ===========    ===========

                                                    LIABILITIES
                                                    -----------

CURRENT LIABILITIES
   Accounts payable                                                              $    73,689    $    33,793
   Accrued expenses                                                                  412,300        190,510
   Franchisee/licensee remittance payable                                            436,036        396,991
   Current portion long term liability                                                27,998         26,521
   Other                                                                             180,642        666,669
                                                                                 -----------    -----------
        TOTAL CURRENT LIABILITIES                                                  1,130,665      1,314,484
                                                                                 -----------    -----------


LONG TERM LIABILITY                                                                   12,275         33,462
                                                                                 -----------    -----------

STOCKHOLDERS' EQUITY
   Common stock                                                                       47,820         47,820
   Additional paid in capital                                                      2,148,470      2,148,470
   Treasury stock                                                                   (529,584)      (529,584)
   Other                                                                              62,893         83,221
   Retained earnings                                                               4,956,012      4,814,266
                                                                                 -----------    -----------
                                                                                   6,685,611      6,564,193
                                                                                 -----------    -----------
   TOTAL LIABILITIES & STOCKHOLDERS' EQUITY                                      $ 7,828,551    $ 7,912,139
                                                                                 ===========    ===========
</TABLE>
*Condensed from audited financial statements.
 The accompanying notes are an integral part of these condensed statements.
                                        2
<PAGE>
                       FRONTIER ADJUSTERS OF AMERICA, INC.
                                AND SUBSIDIARIES

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                   (unaudited)
<TABLE>
<CAPTION>
                                           Nine Months Ended         Three Months Ended
                                           March 31,                 March 31,
                                           -----------------         ------------------
                                           1998         1997         1998         1997
                                           ----         ----         ----         ----
<S>                                     <C>          <C>          <C>          <C>       
REVENUE
   Continuing licensee and
    franchisee fees                     $3,436,123   $3,993,862   $1,094,217   $1,305,133
   Adjusting fees                          899,259      660,627      346,215      180,632
                                        ----------   ----------   ----------   ----------
                                         4,335,382    4,654,489    1,440,432    1,485,765
                                        ----------   ----------   ----------   ----------


COST AND EXPENSES
   Compensation and employee benefits    2,036,412    1,854,557      712,261      591,675
   Office                                  299,019      283,675      116,600       81,316
   Advertising and promotion               240,281      261,176      115,698      121,088
   Depreciation and amortization           192,083      173,974       66,986       59,807
   Provision for doubtful accounts         144,000      135,000       48,000       45,000
   Other                                   481,800      564,655      147,030      195,622
                                        ----------   ----------   ----------   ----------
                                         3,393,595    3,273,037    1,206,575    1,094,508
                                        ----------   ----------   ----------   ----------
INCOME FROM OPERATIONS                     941,787    1,381,452      233,857      391,257
                                        ----------   ----------   ----------   ----------

OTHER INCOME (EXPENSE)
   Interest income                         101,405      113,738       31,555       39,562
   Other (Net)                              44,596       52,956        9,488        6,419
                                        ----------   ----------   ----------   ----------
   TOTAL OTHER INCOME (EXPENSE)            146,001      166,694       41,043       45,981
                                        ----------   ----------   ----------   ----------
   INCOME BEFORE INCOME TAXES            1,087,788    1,548,146      274,900      437,238


INCOME TAXES                               427,938      610,899      108,083      172,101
                                        ----------   ----------   ----------   ----------
   NET INCOME                           $  659,850   $  937,247   $  166,817   $  265,137
                                        ==========   ==========   ==========   ==========


Weighted Average Shares
 outstanding                             4,605,358    4,608,489    4,605,358    4,609,358
                                        ==========   ==========   ==========   ==========

BASIC EARNINGS PER SHARE                $      .14   $      .20   $      .04   $      .06
                                        ==========   ==========   ==========   ==========

DILUTED EARNINGS PER SHARE              $      .14   $      .20   $      .04   $      .06
                                        ==========   ==========   ==========   ==========
</TABLE>
The accompanying notes are an integral part of these condensed statements.
                                        3
<PAGE>
                       FRONTIER ADJUSTERS OF AMERICA, INC.
                                AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)

                    Nine Months Ended March 31, 1998 and 1997
<TABLE>
<CAPTION>
                                                             1998           1997
                                                          -----------    -----------
<S>                                                       <C>            <C>        
NET INCOME                                                $   659,850    $   937,247
                                                          -----------    -----------
Adjustments to reconcile net income to net cash
provided by operating activities:
   Depreciation and amortization:
        Operations                                            192,083        173,974
        Other                                                   1,639          1,092
   (Gain) on sale of investments                               (4,042)          --
   (Gain) on disposition of property and equipment             (6,708)       (24,775)
   Allowance for doubtful accounts                            144,000         (7,542)
Change in assets and liabilities:
(Increase) decrease in:
   Receivables                                                131,763        228,903
   Prepaid expenses                                            51,248        106,769
   Other                                                      (59,949)       (57,130)
Increase (decrease) in:
   Accounts payable                                            39,896         18,051
   Accrued expenses                                           221,790        121,172
   Franchisee and licensee remittance payable                  39,045        272,274
   Other                                                     (486,027)        79,437
                                                          -----------    -----------
Total adjustments                                             264,738        912,225
                                                          -----------    -----------
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES              924,588      1,849,472
                                                          -----------    -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures                                      (151,434)      (283,171)
   Investments purchased                                   (1,992,855)    (1,948,737)
   Proceeds on Sale of Fixed Assets                            16,200           --
   Proceeds from sales of investments                       2,040,000      2,000,000
   License acquisition                                         (5,000)       (85,500)
   Advances to licensees and franchisees                   (3,092,505)    (2,883,089)
   Collections of advances to licensees and franchisees     2,868,177      2,756,041
                                                          -----------    -----------
   NET CASH PROVIDED (USED IN) BY INVESTING ACTIVITIES       (317,417)      (444,456)
                                                          -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Cash dividends                                            (518,104)      (518,650)
   Common stock repurchased                                      --          (44,365)
   Payments on long-term liability                            (19,710)       (68,336)
                                                          -----------    -----------
   NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES       (537,814)      (631,351)
                                                          -----------    -----------
   EFFECT OF EXCHANGE RATE CHANGES ON CASH                        124           --
                                                          -----------    -----------

NET INCREASE (DECREASE) IN CASH                                69,481        773,665
   Cash at beginning of the period                          1,012,233        534,540
                                                          -----------    -----------
   Cash at the end of the period                          $ 1,081,714    $ 1,308,205
                                                          ===========    ===========

Supplemental disclosures of Cash Flow information
Cash paid during the period
   Income taxes                                           $   506,413    $   632,349
   Interest                                               $     2,833    $     6,095
</TABLE>
The accompanying notes are an integral part of these condensed statements.
                                        4
<PAGE>
                       FRONTIER ADJUSTERS OF AMERICA, INC.
                                AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)


(1) Basis of Presentation
    ---------------------

    The  financial  information  included  herein is  unaudited;  however,  such
    information reflects all adjustments  (consisting solely of normal recurring
    adjustments)  which are, in the opinion of management,  necessary for a fair
    statement of results of operations for the interim periods.

    The results of  operations  for the three and nine month periods ended March
    31, 1998 are not  necessarily  indicative  of the results to be expected for
    the full year.

    Change of Accounting Principles
    -------------------------------

    Effective  December  31,  1997,  the Company  adopted  Financial  Accounting
    Standards  Board  (FASB)  Statement  No. 128,  "Earnings  Per Share",  which
    supersedes  Accounting  Principles Board (APB) Opinion No. 15. Statement No.
    128 requires  the  presentation  of earnings per share by all entities  that
    have common stock or potential common stock,  such as options,  warrants and
    convertible  securities  outstanding  that trade in a public  market.  Under
    Statement  No. 128,  the  Company is  required to present  basic and diluted
    earnings per share amounts. Diluted per share amounts assume the conversion,
    exercise,  or issuance of all potential common stock instruments  unless the
    effect is to reduce a loss or increase the income per share from  continuing
    operations.  The Company initially applied Statement No. 128 for its interim
    period  ending  December 31, 1997 and all prior  periods  presented  with no
    material effect.

    The weighted  average  shares  outstanding  for computing  basic and diluted
    earnings per share were 4,605,358 and 4,673,590, respectively, for the three
    months ended March 31, 1998, and 4,608,489 and 4,676,631 for the nine months
    ended  March  31,  1998.  The  difference  in the  weighted  average  shares
    outstanding  for  computing  basic and diluted  earnings per share is due to
    43,435 dilutive stock options.

(2) Supplemental Cash Flow Information
    ----------------------------------

    Item 2 -  Management's  Discussion  and Analysis of Financial  Condition and
    Results of Operations

    The  statements  contained  in this  Report on Form 10-Q that are not purely
    historical are forward looking  statements within the meaning of Section 27A
    of the Securities Act of 1933, as amended, and Section 21E of the Securities
    Exchange  Act of  1934,  as  amended,  including  statements  regarding  the
    Company's  "expectations",   "anticipation",   "intentions",  "beliefs",  or
    "strategies"  regarding  the  future.  Forward  looking  statements  include
    statements regarding revenue, margins,  expenses, and earnings analysis with
    regard  to the  Company  or  with  regard  to the  Company's  licensees  and
    franchisees for the remainder of fiscal 1998 and thereafter; improvement of,
    and growth in the number of, licensees and  franchisees;  future spending on
    marketing and product  development  strategy;  and liquidity and anticipated
    availability of cash for operations,  acquisitions, or payment of dividends.
    All  forward  looking  statements  included  in this  document  are based on
    information  available  to the Company on the date of this  Report,  and the
    Company assumes no obligation to update any such forward looking  statement.
    It is  important  to note that the  Company's  actual  results  could differ
    materially from those in such forward looking statements.  Among the factors
    that  could  cause  actual  results  to differ  materially  are the  factors
    discussed in this Report, including but not limited to the extent and nature
    of natural  disasters in geographic  areas serviced by the Company or by its
    licensees and franchisees;  management  decisions by insurance companies and
    self-insureds  to increase or decrease the degree to which they contract for
    services offered by the Company, its licensees or franchisees; the Company's
    ability to identify and attract new qualified licensees and franchisees; the
    success of the Company's  promotional and marketing programs;  the Company's
    ability to successfully  manage offices  reacquired from existing  licensees
    and  franchisees;  and  uninsured  liability  for acts or  omissions  of the
    Company's employees,
                                        5
<PAGE>
    licensees, or franchisees.

    Financial Condition
    -------------------

    The Company has  historically  financed  its growth and on going  operations
    with cash  generated  from  operations.  In the nine months  ended March 31,
    1998, the Company's operations generated $925,000 in cash.

    Compared to the last fiscal year, the most  significant  item affecting cash
    provided  by the  Company's  operations  is the  $486,000  decrease in other
    liabilities.  The decrease  results from a $525,000 payment during the first
    quarter of fiscal 1998  pursuant to an agreement  the Company had entered in
    June 1997 to settle litigation.

    Through its capital  investment  program,  the Company replaces  obsolete or
    outdated  equipment and invests in new equipment and furnishings to maintain
    or increase the  productivity of the Company and its employees.  The Company
    anticipates  investing  between  $200,000  to  $300,000  in fiscal  1998 for
    equipment and furnishings pursuant to its capital investment program.

    Management  believes  that the Company  will be able to fund all of its cash
    requirements  (i.e.  current  operations,  capital asset acquisition and the
    payment of dividends)  from currently  available  cash funds  generated from
    operations.

    The Company's  ratio of current assets to current  liabilities was 4.06 to 1
    as of March 31, 1998 and 3.51 to 1 as of June 30, 1997.

    Results of  Operations - Nine Months  Ended March 31, 1998  Compared to Nine
    ----------------------------------------------------------------------------
    Months Ended March 31, 1997
    ---------------------------

    Revenue
    -------

    The Company's  revenue  decreased 6.9% or $320,000 to $4,335,000  during the
    nine months ended March 31, 1998 from  $4,655,000  in the same period of the
    prior fiscal year. This decrease  represents a combined $238,000 increase in
    adjusting  and risk  management  fees and a $558,000  decrease in continuing
    licensee and franchisee fees.

    The increase of $238,000 in adjusting and risk management fees from $661,000
    in the nine months  ended  March 31,  1997 to  $899,000  for the nine months
    ended March 31, 1998  represents a 36% increase.  A  significant  portion of
    this increase is related to the Company's Las Vegas/Henderson, Nevada office
    which was  acquired  during the last quarter of the prior fiscal year from a
    former licensee.  This office  generated  $270,000 in adjusting fees for the
    nine months ended March 31, 1998.

    The Company's revenue from continuing licensee and franchisee fees decreased
    14% or $558,000  from  $3,994,000 in the nine months ended March 31, 1997 to
    $3,436,000 in the nine months ended March 31, 1998.  This decrease  reflects
    the loss of revenue  attributed  to a client that  contributed  18.8% to the
    continuing  licensee and franchisee  fees in 1997. In June 1997, this client
    elected to purchase its adjusting  services from other vendors.  The effects
    of this  decision  will be reflected  in the  Company's  revenue  during the
    remainder of the 1998 fiscal year.

    The  Company's  revenue is affected by numerous  matters  including the work
    loads of other companies and claims presented by their clients. The Company,
    therefore,  is unable to project  its  future  revenue.  During the  current
    fiscal year, the Company has experienced a decrease in revenue due primarily
    to the phase out of its business  relationship  with a client that accounted
    for 18.8% of  continuing  licensee  and  franchisee  fees.  The  Company has
    responded  to this loss of revenue by  establishing  a new  promotional  and
    marketing  program and anticipates  that over time the lost business will be
    replaced.  As a result,  the  Company  hopes to see growth in  licensee  and
    franchisee  fees paid from other sources.  During December 1997, the Company
    successfully completed negotiations for national/regional relationships with
    one new client and with three existing clients for additional  services.  In
    addition,  the Company entered into three  relationships with new clients in
    the third quarter of this
                                        6
<PAGE>
    fiscal year.

    Compensation and Fringe Benefits
    --------------------------------

    Compensation  and  fringe  benefits  represent   approximately  60%  of  the
    Company's costs and expenses and represent the Company's largest single item
    of expense.  These expenses increased 10% or $182,000 from $1,855,000 in the
    nine months  ended March 31, 1997 to  $2,036,000  in the current  nine month
    period.  This increase is the result of the addition of a Marketing Director
    to the Company's corporate staff, the new employees in Las  Vegas/Henderson,
    Nevada as a result of that acquisition, additional employees hired including
    temporary  employees to handle increased work loads in the Corporate office,
    and cost of living and merit increases given to employees.

    Expenses Other Than Compensation and Fringe Benefits
    ----------------------------------------------------

    The Company's expenses other than compensation and fringe benefits decreased
    $61,000  during the nine months ended March 31, 1998 as compared to the same
    period of the  prior  fiscal  year.  The  principle  items  affecting  these
    expenses are an $87,000  decrease in legal expense,  an $18,000  increase in
    depreciation expense due to capital expenditures in the current fiscal year,
    a $21,000  decrease in  advertising  and  promotion  expense,  and a $15,000
    increase in office expense.

    The  balance of the  Company's  costs and  expenses  have not  significantly
    changed from the same period of the prior year.

    Income Taxes
    ------------

    The Company's income taxes for the nine months ended March 31, 1998 were 39%
    of its income before taxes,  or  approximately  the same as they were in the
    same  period  of the  prior  fiscal  year.  Changes  made in the tax laws by
    various states and by the federal  government have not had a material affect
    on the Company's  current overall tax rates;  however,  this could change at
    any time.

    Other Income
    ------------

    The  Company's  other income  decreased  $21,000 or 13% from $167,000 in the
    nine months  ended  March 31,  1997 to  $146,000  in the current  nine month
    period.  The most  significant  items  affecting  other income are a $12,000
    decrease in interest income, an $18,000 decrease in gains on the disposition
    of capital  equipment,  an $18,000  increase  in dividend  income,  a $6,000
    decrease in rental income and a $6,000 decrease in miscellaneous income.

    Net Income
    ----------

    The Company's net income for the nine months ended March 31, 1998, decreased
    $277,000 or 30% from  $937,000  in the nine  months  ended March 31, 1997 to
    $660,000 in the current  period.  The most  significant  items affecting net
    income  were the  $320,000  decrease in revenue,  the  $181,000  increase in
    compensation and fringe benefits, and the $61,000 decrease in expenses other
    than compensation and fringe benefits.

    Results of  Operations - Three Months Ended March 31, 1998 Compared to Three
    ----------------------------------------------------------------------------
    Months Ended March 31, 1997
    ---------------------------

    Revenue
    -------

    The  Company's  revenue  decreased 3% or $46,000 to  $1,440,000 in the three
    months ended March 31, 1998 from  $1,486,000 in the same period of the prior
    fiscal  year.  This  decrease  represents  a combined  $165,000  increase in
    adjusting  and risk  management  fees and a $211,000  decrease in continuing
    licensee and franchisee fees.

    The  increase  of  $165,000  in  adjusting  and other fees of Company  owned
    offices  from  $181,000 in the three 
                                       7
<PAGE>
    months  ended March 31, 1997 to $346,000 in the three months ended March 31,
    1998  represents a 91%  increase.  The increase  reflects an increase in the
    demand for the  Company's  services in the  Phoenix  area as well as revenue
    from  the  Company's  Tucson,   Arizona  and  Las  Vegas/Henderson,   Nevada
    operations.

    The Company's revenue from continuing licensee and franchisee fees decreased
    16% or $211,000 from  $1,305,000 in the three months ended March 31, 1997 to
    $1,094,000 in the three months ended March 31, 1998. This decrease  reflects
    the loss of revenues  attributed to a client which  contributed 18.8% to the
    continuing  licensee and franchisee  fees in fiscal 1997. In June 1997, this
    client elected to purchase its adjusting  services from other  vendors.  The
    effects of this decision will be reflected in the Company's  revenue  during
    the remainder of 1998 fiscal year.

    The  Company's  revenue is affected by numerous  matters  including the work
    loads of other companies and claims presented by their clients. The Company,
    therefore,  is unable to project  its  future  revenue.  During the  current
    fiscal year, the Company has experienced a decrease in revenue due primarily
    to the phase out of its business  relationship with a client which accounted
    for 18.8% of  continuing  licensee  and  franchisee  fees.  The  Company has
    responded  to this loss of revenue by  establishing  a new  promotional  and
    marketing  program and anticipates  that over time the lost business will be
    replaced.  As a result,  the  Company  hopes to see growth in  licensee  and
    franchisee  fees paid from other sources.  During December 1997, the Company
    successfully completed negotiations for national/regional relationships with
    one new client and with three existing clients for additional  services.  In
    addition,  the Company entered into three  relationships with new clients in
    the third quarter of this fiscal year.

    Compensation and Fringe Benefits
    --------------------------------

    Compensation  and  fringe  benefits  represented  approximately  59%  of the
    Company's  costs and  expenses  and  represent  the  largest  single item of
    expense. These expenses increased 20% or $120,000 from $592,000 in the three
    months  ended March 31, 1997 to $712,000 in the three months ended March 31,
    1998. The increase is the result of the addition of a Marketing  Director to
    the Company's  corporate staff,  the new employees in Las Vegas/  Henderson,
    Nevada as a result of that acquisition, additional employees hired including
    temporary  employees to handle increased work loads in the Corporate office,
    and cost of living and merit increases given to employees.

    Expenses Other Than Compensation and Fringe Benefits
    ----------------------------------------------------

    The Company's expenses other than compensation and fringe benefits decreased
    $9,000  during the three months ended March 31, 1998 as compared to the same
    quarter of the prior  fiscal  year.  The  principle  items  affecting  these
    expenses were a $53,000  decrease in legal  expense,  a $36,000  increase in
    office expense, and a $7,000 increase in depreciation and amortization.

    The balance of the Company's costs and expenses did not change significantly
    from the same period of the prior fiscal year.

    Income Taxes
    ------------

    The Company's  income taxes for the three months ended March 31, 1998,  were
    39% of its income before taxes,  or  approximately  the same as they were in
    the same period of the prior  fiscal  year.  Changes made in the tax laws by
    various states and by federal  government did not have a material  affect on
    the Company's overall tax rates; however, this could change at any time.

    Other Income
    ------------

    The Company's other income decreased $5,000 or 11% from $46,000 in the three
    months  ended March 31, 1997 to $41,000 in the three  months ended March 31,
    1998.  The most  significant  items  affecting  other  income  was an $8,000
    decrease in interest income and a $3,000 increase in miscellaneous income.

    Net Income
    ----------

    The Company's net income for the three months ended March 31, 1998 decreased
    37% or $98,000  from  $265,000 in the three  months  ended March 31, 1997 to
    $167,000.  The most significant  items affecting net income were the $46,000
    decrease in  revenue,  the  $120,000  increase  in  compensation  and fringe
    benefits,  and the $9,000 decrease in expenses other than  compensation  and
    fringe benefits.
                                       8
<PAGE>
PART II:  OTHER INFORMATION

Item 1 - Legal Proceedings

From time to time in the normal course of its business,  the Company is named as
a defendant in lawsuits.  The Company does not believe that it is subject to any
such lawsuits or litigation or threatened  lawsuits or litigation that will have
a material adverse effect on the Company or its business.




                                   SIGNATURES



Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                        FRONTIER ADJUSTERS OF AMERICA, INC.



Date:         5/14/98                   /s/         William J. Rocke
     --------------------------         ----------------------------------------
                                        William J. Rocke, Chief Executive 
                                        Officer/Chairman of the Board, Director 
                                        and Acting Chief Accounting Officer


Date:         5/14/98                   /s/         Jean E. Ryberg
     --------------------------         ----------------------------------------
                                        Jean E. Ryberg, President, Director
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